Alibaba Goes Public: Case Study – Business Report

Case Brief

The case study ‘Alibaba goes public’ is a presentation of journey of Alibaba from its modest beginnings to opening the largest IPO offering in US of about US$21.8 billion (Chen et al., 2015). In the year 2014, Alibaba got its much-awaited debut on the New York Stock Exchange, crafting not only the largest IPO in record but this original aspiration to list on the Hong Kong Stock Exchange was refuted owing to the firm’s request to reserve its colleague’s power over verdict privileges.

After working as an English tour guide and a teacher in city of Hangzhou, China, Jack Ma realised his entrepreneurial dream of opening a venture of his own in year 1999 along with 17 others. He had a vision of a global e-commerce company that would survive a 102 year. Alibaba was born. Ma trusted in his tactic to form a prosperous commerce in the Chinese setting – universal image, native victory. Dissimilar to numerous other Chinese businesspersons who modified effective U.S. internet business models that managed Business-to-Consumer (B2C) and Consumer-to-Consumer (C2C) transactions, Alibaba shaped its individual commercial prototype. It fixated on the Business-to-Business (B2B) segment and linked small and medium sized firms with several others and opened it for the world to communicate with these Chinese manufacturers.

The Alibaba’s ethos is around supporting small businesses. They have created a functional ecosystem where everyone who participates, such as, – customers, dealers, third-party facility benefactors and others – have a break to flourish (Romagnoli and Garbelli, 2017). Alibaba’s proclaimed six values of doing business are (Tsui et al., 2017):

Customer First – The welfares of society of consumers and vendors. This is their first priority. Teamwork – This is where they acknowledge the employees who come next to customers.  Alibaba encourages a good team culture and believe that through proper teamwork, miracles could happen.

Embrace Change – Alibaba acknowledges the fact that change is constant and one must be flexible enough to adapt and quickly change the situation as a favourable one. Only the fittest could survive.

Integrity –  Alibaba appreciates integrity and encourages its employees to hold this at the core of every transaction. They should strive to do the right thing and not take up unacceptable measures.

Passion – Alibaba encourages all its members to keep doing work with a fire within and not give up hope.

Commitment – Employees are always rewarded with recognition and other perks to keep up their motivation level

Alibaba could be rightly explained as a combination of Amazon.com, eBay and PayPal with a trace of Google tossed in, all with some distinctively Chinese personalities. Alibaba has always worked as an intermediary, unlike Amazon.  It simply connects buyers and sellers while simplifying businesses among them. This is similar to character of eBay except that it is not an auction organization.

It competed with eBay to finally overthrow and compel it to exit from Chinese market by introduction of Taobao (Valero, 2016). Unlike eBay, the only money that TaoBao took from its sellers was for advertisements and merchant bidding for keywords for routing through search results. It also introduced its own escrow service which was fee-free called Alipay to arrest the trust issues between buyers and sellers. Soon, it became plagued with issues of counterfeit goods and premium brands wanted to detach themselves from such a platform (Ransom et al., 2014). That is how Tmall came into existence. Yue bao came into existence on a need basis but eventually catapulted itself as a money parking station which provided interest rates much more than Chinese banks. TaoBao’s mobile app became very successful and accounted for 86% of sales in Chinese market through mobile app (Ma, 2016). Alibaba, after getting its first funding and initial partnership with Yahoo in 2005, had made lots of changes and has had ownership issues. In preparation of getting itself enlisted in HKEx, it opted for internal strategies to evade denial of enlisting but all failed (Chan and Ho, 2014). Finally, after much wait, it took its IPO to New York and Nasdaq. It met with much objections with many governance experts outright criticising and showcasing pitfalls but finally Alibaba did have what it sought (Petry, 2014). Their governance measures were accepted by both Nasdaq and NYSE and the rest is history (Lin and Mehaffy, 2015).

There are certain questions here so as to – Why did HKEx turn down the e-commerce giant like Alibaba? How come it denied the dual-class shares or deny its partners to have the rights of nominating board members? Thereafter despite warnings from governance experts, how did the governance measures came to be accepted by the American stock market?

The report shall also lay focus on researching strategies that could be adopted by Alibaba in their international growth strategies. First the report shall present the findings from the case study such as the positives and negatives in terms of strategies taken up by Alibaba. There is a section of SWOT analysis (over various timelines) and Porter’s five forces analysis conducted for Alibaba which highlights challenges faced by Alibaba at different timelines and examining the strategies adopted for further growth. Alibaba is almost always associated with fraud imports of fake products. Despite buyer protection programs (Yu and Shen, 2015) and verified sellers (Sun, et al., 2017), fake products do end up on Taobao website. While other countries take stringent action in this regard and organizations are pretty protective of their image, Alibaba’s approach, on the other hand, is not protective at all. The counterfeit good issue is quite old and has been tormenting them from many years. However, the actions taken are half hearted what with only 2 lawsuits in 2017. The report shall also discuss the counterfeit issue faced by Alibaba and what measures it could adopt.

E-commerce giant from China, Alibaba got enlisted on New York Stock Exchange (NYSE) and Nasdaq after being rejected to be listed on the Hong Kong Stock Exchange (HKEx) (Lee, 2015) in 2013. This was following a dispute between Alibaba’s existing governance structure and the regulations in HKEx. They stressed to support stockholder parity in publicly listed companies (Nwogogu, 2015). However, the 28 partners of Alibaba wanted their control ‘only’ in nominating the board members in majority. Even though they held a collective marginal shareholding of minus 15 per cent in the business. This was the controversy. The HKEx mechanism of an essential public procedure requires that all listed companies’ shareholders must have parity. Hence, the dual share classes as required by Alibaba was not permitted by Hong Kong Stock Exchange (Hein et al., 2016).

This is totally different to how things function in United States. The US policy for listing permits dual share classes. There, a group of equity shareholders would have the power to nominate as well as remove directors if they choose to. This could be done by them when they need to ensure compliance with severe reporting necessities. Certain organizations even consider restructuring their management arrangements as well so as to reap the advantages of dual class policy existent in US (Xiao Hung, 2016). Alibaba is not a sole example, earlier even Manchester United avoided listing on Hong Kong Stock Exchange and chose New York Stock Exchange instead.

Due to the dual-class equity ownership structure existent in US, leading to insider control. Tech giants like Google, Facebook, both listed on Nasdaq, also take benefit of the two classes of stocks. that lets insiders retain control. As is evident, US is more favourable for organizations who may be interested in exclusive commercial arrangements proposing certain regulatory entitlements (Xiao Hung, 2015).

Now let’s discuss the point of keeping 28 people at the wheel of Alibaba by Jack Ma. Alibaba has a 28-man conglomerate arrangement, containing exclusively of forefathers of the business and important older administrators. These 28 people do not sit in board of directors, however; they could easily nominate most directors with their bestowed powers. They make the nominations but all stockholders could vote for or against the nomination as their holdings of the shares. Together, the 28 members own less than 15%, 13% accurately of total shares of Alibaba. Whereas, Yahoo! Inc.(Yahoo!) and SoftBank Corporation (SoftBank) hold 24% and 37% correspondingly. The residual shares are detained by separate individual smaller shareholders. Now, whenever the nominations are rejected by the shareholders, the members could further nominate other people. This would continue till the board of directors is complete. Jack explains that this is how he ensures that the organization is operated only the group of people who are passionate about Alibaba and work towards materializing the vision of the company.

Joe Tsai, Group Executive Vice-Chairman, also openly supports this view. He deems the conglomerate arrangement supports to preserve the enterprise’s inventive ethos even if the original creators depart from the firm (Li, 2015), ensuring the firm of a long-term tactical emphasis rather than bigoted or short-term profits. Just weeks after application submission to HKEx, in September 2013, Alibaba’s plea got rejected. Negotiation did not help the situation. As discussed this was owing to HKEx’s mandate to provide parity to all shareholders – “one share, one vote” code.  Alibaba’s proposal for listing provided the 28 partners with extra power to nominate board of directors. HKEx asserts that such a framework would provide shareholders who collectively hold a small margin of shares more powers. Charles Li, CEO of HKEx, strengthened this stance by clarifying that HKEx does not approve of a structure like DCS except in exceptional cases. He also insisted that just for one applicant rules could not be bended.

The prerogative of this research report is to investigate the choices make by Alibaba in opting for NYSE. How is it going to chart its path of further future growth. What are the challenges in environment for Alibaba at present and what are some recommendations it could follow. The report shall also attempt to conduct a SWOT and PESTLE analysis for Alibaba and deduce actions that could be taken by it.

Also, a major issue in front of Alibaba is the counterfeit goods issue. The report shall try to look for ways in which Alibaba could attempt to resolve the issue. It is however wise to hold realistic expectations in this regard. This is because soon after the Govt. of China accused Alibaba Group of allowing counterfeiters to conduct business through its website, SAIC and Alibaba, both joined hands ASAP. They are to devise plans to safeguard the consumers interests against counterfeits on the online platform (John, 2016). Alibaba has agreed to investing 300 employees (all new hired) to form a taskforce to counter the issue of fake goods (Ebel, 2016). The pace is however very slow. This actually, puts consumers in doubt if this delay is skill or will issue for Alibaba. It is however, not to be forgotten that in poor countries, owing to weaker buying strength, people openly use fake goods and it is a thriving black market (Werner, 2017) (Sui, 2015). Strict policing by governments have seldom yielded results (Harris et al., 2015). Alibaba has however, shown its enthusiasm in participating in this fight against fake goods (Han and Kim, 2017). It has spent millions of dollars in 2013 & 2014 to arrest the problem. Nevertheless, the directives of digital commerce have converted itself into a game of “spiralling saucers.” As quickly as one hawker of copy merchandises is jammed another originates to take its room (Berman and Dong, 2016). Alibaba carries on casual checks exploiting data-mining knowledge and runs an online forum to put down complaints for regulation of fake goods (Liang and Gai, 2015).

After opening the business doors of Alibaba to the world in 1999, the Alibaba group just focused on creating a B2B website for Chine small – medium manufacturers and connect them. Over the years, it has only extended its range in many ways. As of today, they have over 10 businesses, more than 25,000 employees and are valued at approximately $8 billion. In such a dynamic and fast paced dot com industry and China’s e-commerce boom market (Micklethwait and Dimond, 2017), this was possible only because Alibaba constantly kept n retuning its strategies at every stratum. When Alibaba commenced its setups, in China, internet was only about 1%. As the marketplace changed, the business’s frontrunners re-examined their concepts, examining their theories against actuality and reviewing them as suitable.

In early stages, Alibaba’s goal was simply to become an e-commerce organization serving China’s small-medium scale manufacturers and opening to them the trade doors of the world. They sincerely built a sales platform. With times, market conditions altered and they revisited this previous vision and realized the power of direct customers, thus, came Taobao in 2003. On realizing that the trust factor is the hindrance to many customers buying goods online (Ali and Li, 2015), they created Alipay in 2004 – an online payment service. By offering together an escrow service and a supplier rating system, Alipay presented the components for transparency and reliance. This helped them penetrating further into Chinese market. Further, in 2008, it dreamt of creating a commercial eco system in e-commerce industry. Then, it offered cloud computing programme, microfinancing, and a clever logistics programme. By consistently rearranging its ideas, Alibaba has been successful in responding without delay to new market and their conditions simultaneously restructuring the manners of interactions of customers and businesses.  

Primary turning point to success of Alibaba also came when it chose to go for NYSE and Nasdaq IPO listing (Dolvin, 2014). The challenge to Alibaba was the turning down of Alibaba owing to DCS system it wanted to follow (Chan and Ho, 2014). The problem scenario discussed in the case study shall be:

1. Challenges faced by Alibaba in it growth period
2. What retuning of strategies were adopted to penetrate the international market
3. What are current challenges to its growth

Steps taken to address the scenarios are:

1. Revisiting the case
2. Looking up case history of Alibaba in various reference books and journals
3. Conducting SWOT analysis for Alibaba in the inception, growth and maturity phase
4. Conducting a Porter’s five forces analysis to review the current scenario
5. Discussed recommendations

Post launching its commercial operations in 1999, Jack Ma and his team of 17 people created a giant e-commerce dot com company it is today through lot of hard work and perseverance. On the way, different hurdles came up time and again showing up on doorsteps but the simplicity of Jack Ma’s vision stood the test of time. Also, the team wanted Alibaba to be flexible and respond to changes immediately without losing any competitive advantage. This was possible only with the help of a robust corporate level strategy. A robust corporate level strategy at Alibaba had 3 key components against the issues that need to be tackled.

Figure 1 – Corporate Strategy

Key Components	Major issues
Portfolio Analysis	· Right mix of business · Cash generators and cash users · Positioning the company for growth · Stable returns vs. risk taking and high returns · Eliminating ‘deadwood’
Diversification	· Analysis of industry attractiveness · Return on invested capital · Integration of acquisitions
Resource allocation to business	· Internal vs external source of investment capital · Performance expectations of different businesses · Review of business performance and future allocation of resource

Figure 2 – The business strategy for tackling issues could be represented as:

	Major issues
Industry Analysis	· Size/concentration of industry · Number of strategic group existing in industry · Buyer power · Industry supplier power · Substitutes available · Existing rivalry
Competitor Analysis	· Competitors Resource and capabilities · Competitor’s size and market power · Competitor strategies · Competitor’s previous defense and offence moves
Resource and Capabilities	· Using own resources, tangible or intangible · Competitor capabilities · Existence of core competencies

The SWOT analysis for Alibaba on launching could be represented as below:

Figure 3 – SWOT Analysis of Alibaba on launching from 1999-2000

Figure 4 – SWOT Analysis of Alibaba in period between 2000-2003

Figure 5 – SWOT Analysis of Alibaba in period from 2003 – 2007

Figure 6 – SWOT Analysis of Alibaba from present (Hu, 2017)

Figure 7 – Porter’s five forces analysis of Alibaba –

Alibaba might not have constructed a collection of businesses that covered almost the complete digital range minus making a promise to commercial prototypical testing from very initial days. Nevertheless, when they initially started outside its central B2B e-commerce stage to introduce Taobao, the choice was fiercely discussed in the business, as it meant going head-to-head with a seemingly enormous eBay. To minimalize interruption at the potential B2B business, Taobao was set up as an autonomous business, with an individual office and individual money (a 50/50 joint venture between Alibaba and SoftBank). At each stage in its development, Alibaba continuously generated innovative business models as well as let them have a solo run (Fan and Liu, 2015). After examination, Alibaba ventured to scale them up if it looked potential winner. In 2006, for instance, seeing two new developments, Alibaba decided to unveil two units. To get an entry to B2C market, it created the Taobao mall. It became the podium for recognised brands to extend to Chinese customers. This was the idea of Tmall, today, it is a major part of Alibaba’s portfolio. Alibaba launched Alisoft to cash in on the software-as-a-service wave. This however did not have much audience and he shut it down. Additional driver of Alibaba’s accomplishments has always been the aptitude to moderate its degree of business model research to fit the situations. For instance, after 4 years of its launch Taobao had spread to 80% of Chinese consumer market (digital). In 2011, it had converted into a countrywide miracle. Several establishments would have reserved this management situation as validation and concentrated on adjusting the popular model. In its place, Alibaba foresaw the non-stop speedy growth of China’s connected people and the growing complexity of buyers and vendors as pointers of pronounced ambiguity in the market and a threat to the present-day prototype.

For Alibaba, Chinese e-commerce market comprises of over 85% of revenue, compared to about 8% of international business. Alibaba has plans to expand further into China by improving the reach in rural regions as a strategy to dominate domestic market. With an expanding population, China is a good opportunity for Alibaba considering it is also home ground. They propose to grow the national market by using recognised working centres in backdated areas to fetch and endorse agrarian goods that will be marketed and sold online. Despite its major haul of groups within China, Alibaba cannot ignore the potential it has when it comes to international markets. The current setup of Alibaba is to cater to Chinese market and China, within itself is also a large untapped market. Alibaba has intentionally augmented its worldwide existence at a slow stride thoughtful that international markets have diverse sets of wants when matched to China. In 2007, at Geneva, Alibaba opened a European office with intention of capturing the European market. In 2013, also in US, as part of strategic expansion and overtaking US companies. This was hastened by Alibaba’s sturdiest world-wide participants Amazon and eBay, both situated in the United States.

Now, let’s discuss the SWOT analysis for the origin years of Alibaba, 1999-2000. This was the time when Alibaba raised money from Venture Capitalist & SoftBank. It had built its initial platform to cater to B2B. By the time the year ended, it had about 2 lac memberships. Alibaba made other companies get interested in the e-commerce business. It stood quite sturdily the dot com bubble. The primary objectives of Alibaba in that phase was to create an employee base, create a customer base and chalk out a name for itself. Upon analysing the SWOT (Figure 3), findings are as below:

1. Market was new and players were still figuring out the commerce (Addai et al., 2017)
2. Leadership is strong with 18 members all focused and like minded with same dream
3. With broadband still in a nascent stage, e-commerce industry was still to find out its potential
4. Use of banking systems and specially online not very popular, people had apprehensions

Post 2000, Alibaba’s focus was to withstand the dot com burst, consolidate position of the company, build a strong image and retain employees. The SWOT analysis (Figure 4) points out:

1. Unstable industry, people are still figuring out how to make the ecommerce work effectively
2. Entry threat of eBay
3. New opportunities showed itself as C2C and B2C untapped market segments
4. Revenue model was still weak, needed more funds

In Phase 3 from 2003 to 2007, Alibaba successfully took opportunity up and ventured into C2C and B2C business. Finally, eBay had to exit the China market owing to successful strategies by Alibaba. It also acquired Yahoo! China’s partnership. Alibaba had also set its targets to expand further into China. It had also strategized to make a global presence and work on its revenue model to achieve more. Analysis of Figure 5, SWOT analysis shows:

1. Diversification proved beneficial for Alibaba and it should be continued
2. Hard work on improving the financial models moved to the strengths corner and benefitted Alibaba
3. Yahoo! China  links became quite ambiguous for Alibaba’s own identity
4. The relationship undermined Alibaba in the eyes of its customers
5. Google and Baidu slowly rising up the ladder to pose themselves as threats for Alibaba
6. IPOs seemed fairly new scheme for growth and was an opportunity for Alibaba to cash in

 The current SWOT analysis of Alibaba as per Figure 6:

Strengths of Alibaba – Strong strategies and quick retuning has assisted Alibaba in its strive for growth and expansion. Today, it is a global company with businesses spread to many countries. This is also a great strategy for earning profits. Several acquisitions are usually great strategies to gain entry into unchartered territories. The e-commerce industry is still growing with large untapped segments and Alibaba is strategizing to enter them as well. The fact that it brought together the community of buyers and sellers and also implemented measures to gain trust of customers and suppliers alike to do business without any fear is commendable and is firmly placed in its strengths (Forgione, 2016).

Weaknesses of Alibaba – The technology is still the low level or a weakness for Alibaba. Other ventures’ sites are lot more attractive unlike Alibaba. That apart, the organization is labour intensive. Its advertisements are hardly to be seen and that could be reasons of determent of growth. Due to incompetent technology, Alibaba’s deliveries are slow. This becomes a reason of weakness for Alibaba. Also, instead of an international approach to its operation, they still have a huge influence of Chinese culture (Yan and Chun Yu, 2013).

Opportunities of Alibaba – Lot of untapped potential within domestic grounds as well as international markets. Plus, there are also lot of segments of ecommerce which are unchartered.

Threats – The rapid and dynamic growth of e-commerce industry is an imminent threat at all times. There are many competitors new and old who have reformed their strategies and are even more clever or have dominance in other markets than Alibaba. This raging competition needs to be worked upon in favour by Alibaba. There is also an impending doom of global economic crisis that takes a long time to recover.

The competitive force analysis, specifically the Porter’s Five forces analysis of competitive environment for Alibaba was used as a key tool to gauge Alibaba’s environment. The findings are:

Threat of new entrants – Alibaba has never shied away from competition. Alibaba’s spokesperson has stressed that competitors enhance the market and hence are welcome.  There is always threat of new opponents but as in the past, these threats have always pushed Alibaba to come up with something new. With its global influence at present, Alibaba has attributed the credibility to new entrants/competition in business.

Rivalry – Eachnet is fast becoming a good player in industry. Apart from them, there are lot of other global giants focused on gaining a permanent top stop in the industry toppiling over some other contender by finding a weak spot. Just like Alipay, Eachnet is also focussed on getting an online payment system operational. ‘Escrow’, a service by Eachnet on lines of Alipay has already gained lot of customers and some even from Alibaba’s kitty

Supplier power of Alibaba – With the help of various partners Alibaba has been successful in keeping the e commerce auction sites up. VeriSign, a well known player in helping companies and customers’ alike in commercial dealings. Alibaba’s suppliers are backbone of Alibaba’s business. They also ensure that customers’ interests are protected at all times.

Buyer power of Alibaba – The auction site caters to suppliers and buyers alike. The success of the organization could be largely attributed to customers who buy online on Alibaba. There is opportunity for small scale businesses to grow using Alibaba, as well as, expand globally. Despite rising competitors, Alibaba has proven loyal customer base

Threat of substitutes – to most of the small-medium scale manufacturers of China, Alibaba is the easiest way to reach out to the world. In case a substitute were to arrive, they would require a further simpler and effective system to rival against Alibaba. The online auction of Alibaba is the simplest and most effective of all.

Competitive Advantage of Alibaba – Alibaba enjoys a competitive position in China. Before Alibaba, there were no players to provide the Chinese buyers and suppliers to provide the benefits that Alibaba is giving them. It was the first mover in Chinese dot com market and hence, has huge competitive edge. The business structure of Alibaba has the benefit of economies of scope. It also possesses benefit of economies of scale.

Barriers to entry – high – there are new entrants coming in but now where is the threat a danger yet for Alibaba. To be successful in the e-commerce industry it is vital to have a good supported chain network of suppliers, distributors, logistics etc. which is gained only after spending considerable time in the industry, i.e. with experience (Alderson, 2016).

Threat of substitutes – low – Through establishments of brick-and-mortar, there is a threat to online retailers. These retailers however lack economies of scope and hence they do not become anything like Amazon or Alibaba.

Bargaining power of buyers – medium – Customers using Alibaba to sell have strong bargaining power. By choosing not to use the platform of Alibaba, they may affect the market dynamics for Alibaba

Bargaining power of suppliers – low – In the Alibaba business structure suppliers usually have least bargaining power.

Industry rivalry – high – Within the online retailing business the competition is tough. The differentiating factor being just ‘price’ and ‘customer service’

The International Anti-Counterfeiting Coalition describes forging (also known as intellectual property theft) as an offence involving developing or distributing products under pretence of being someone else. Without taking appropriate permission. They are prepared using quality deprived components and sell cheap as imitation goods. Fake merchandises cross manifold trades comprising goods such as clothing, music, software etc. Fake merchandises are a tricky situation for several reasons. Firstly, because it is completely illegal and buying these goods knowingly implies that, there is support of illegal trade. Then, fake merchandises can present itself as a health and safety risk to customers. Counterfeit goods are made with low-priced, subnormal, and sometimes hazardous components. Moreover, clients are offering fake suppliers with personal info and are at tremendous hazard for identity theft and credit card racket. Most notably, forging injures authentic establishments which have devoted meaningful period and monetary funds in R&D of products along with building a reputation. Criminals endeavour to benefit from exploiting other enterprises’ trustworthy names. Such imbalanced contest effects in less wage, loss of jobs, sky high prices for consumers. It is unfortunately bleak to see that the counterfeiting business would go down any time sooner in near future.

After contemplating the results of SWOT Analysis of Alibaba as well as market in US, it is safe to give following recommendations:

1. Acquisition of US based web company
2. Include mass advertisements, specially on internet
3. Stick to differentiation and get benefits
4. Participate in sponsorship to let the world know its presence
5. Tap emerging markets – Brazil, Russia, Chile, UAE, Mexico, Malaysia, Uruguay etc.

Alternative strategies that could be taken up by Alibaba to nitro boost domestic market competitiveness. Alibaba Group definitely could focus on getting a good footing in the domestic market before venturing out in the world, into international markets. Some advantages of this strategy could be this that, dominating domestic market in terms of competition will strengthen the tactical skills required to overthrow threats which could be present in various shapes and forms in international markets. One disadvantage of this could be this that in case this leads to Alibaba losing focus of venturing out into global markets and stay coiled into complex domestic market.  It cannot be denied that international market entry challenges are quite strong. All in all, Alibaba must venture out of China and attempt penetrating the world market to increase their market capture. Owing to their record success in China and the name it earned, World is already aware of Alibaba and it may be little bit easier to penetrate new markets. Alibaba group is poised and they have funds to venture into new markets to support their activities. It is a possibility though that due to its heavy presence in China, people may stereotype them as a Chinese organization synonymous with counterfeit goods as well. Some experts have also recommended Alibaba choose the brick and mortar policy.

These would be the places where customers who do not have access to the power of internet or have time to check things online could visit, physical check the products and then purchase. This way Alibaba could be even visible physically. Alibaba could choose to set up these stores in areas where they do not get much active users or even in new markets as a penetration strategy. That could assist in increasing the visibility, awareness and trust factor directly with customers. The flip side to this could be managing the numerous suppliers it has membership. In terms of price, could lower where feasible and offer the customers with ample choice and breaks. Alibaba is a brilliant example of a B2B e commerce organization allowing the manufacturers and suppliers to easily sell on their platform to the world. It should venture out of its comfort zone and enter new international markets. The risk of investing and expansion of their domestic services customized as per world; be offered by them. Alibaba has a fierce determination to find out ways to advance as well as enter global trade markets. This is also for a challenge with their rivals but before attempting to win ground in the country where rival is strongest, they could attempt to win over a market. In this case though, there are risks. Alibaba, however; needs to ensure growth and brand awareness anywhere they choose to start.

After a successful IPO, for any newly listed company, things change, especially if it is a fast-paced company just like Alibaba. The executives must not stop themselves from pushing ahead to face new challenges brought in by IPO. Till IPO, the organization was privately owned but after IPO, key members would also need to deal with investors (Tan, 2016), deliver their commitments, stick to the growth pace and manage risks appropriately (Ke, 2014).

When Alibaba was privately managed, it was only answerable to Jack Ma and 17 others. Upon becoming a public company, Alibaba’s situation would radically change. There would be thousands and thousands of shareholders they need to cater to and build constructive relationship with. All of this could be achieved only through effective strategic planning and proactive measures to cultivate the relationship. Throughout the IPO process Alibaba would have made a convincing fable around the company’s intended chart of growth and strategies it would deploy to gain position in market – it needed to stick to that projected vision as the organization would be under public scrutinization always. The management now needed to arrange their energies to nurture an association with important analysts. The management would need to guide the investors into understanding the business model and encourage positive growth oriented conversations.

Keeping promises and delivering on them – Alibaba should not forget that public market is challenging place. Alibaba would require showing the investors that it is competent in its ways of execution of business plans, maintaining compliance at all levels. Key metrics that will motivate the business to go ahead needs to be properly defined, not only that, it requires to be checked at every milestone appropriately. These results would also be utilized in public analysis of the organization to make sure that all discussions are as per Alibaba’s terms. The firm will also require conservation on top of any threats and could derail the business plans.

Upholding the stride of growth – getting through a successful IPO also means that the team of Alibaba would now require to keep a pressure on team to continue moving ahead and help the team charter the growth path as shown to shareholders. The IPO is always an important milestone on the road to continuous growth.

To summarise, Alibaba has shown an impressive trend till now in forming new strategies, treating the threats to its environment, chartering new growth paths, entering new markets, diversifying the organization etc. in its journey. Limitations of this research report is that the strategies mentioned in recommendations could be time consuming and could only be tested against time. Further research could also be done in terms of competitive analysis when entering new markets, intrusive environmental analysis as well. Alibaba has sustained commercial evolution through China and is testing waters in international markets as well just to be the leader there as well. It has not been easy for them as expected, they have faced innumerable challenges over the years, rivals, IPOs, counterfeiting charges, scams etc. Alibaba’s responses to these experiments are conversed beside the company’s viewpoint for the imminent future.

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